Is this the Future of Adaptation? Who Pays to Avoid the Cost of Coastal Flooding?

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The New York Times reported today that Governor Cuomo is proposing to spend $400 million to buy out owners of property to avoid a recurrence of the damage caused by Hurricane Sandy.  I have to say that I have been persuaded over the past few years that we cannot put all our eggs in the mitigation basket, particularly since political gridlock in Washington has prevented much mitigation from occurring.

As a result, adaptation is going to be important and programs at least similar to what Governor Cuomo has proposed are going to be necessary.  The hard question, of course, is:  who pays?  According to the Times, those in areas most subject to flooding would get paid a premium.  The harsh way to ask the question is to wonder why we should reward people for choosing to buy property that, even before climate change, was located in areas subject to coastal flooding.

I’m afraid that the answer to this question may be that we have no choice.  Our politics requires us to help the victims of natural disasters, even when common sense tells us that we are simply subsidizing bad choices.  Our bizarre takings jurisprudence doesn’t allow us to solve the problem by regulation.  Therefore, voluntary buyouts, which probably require premiums to work, may be unavoidable.

At least New York isn’t Virginia, where significant numbers of lawmakers seem to prefer the ostrich approach.

 

Topics:  Coastal Real Estate, Flooding, Hurricane Sandy, Risk Mitigation, State Buy-Outs

Published In: Elections & Politics Updates, Finance & Banking Updates, Insurance Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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